BOSTON ( TheStreet) -- These companies have more than $500 million in annual revenue, below-average valuations, debt that's less than 49% of total capital and "buy" ratings from our quantitative model, which considers more than 60 factors. They're ordered by their potential to appreciate, starting with the company with the best growth prospects.
MGE Energy (MGEE) is a Wisconsin-based electricity provider.
The numbers: Second-quarter net income dropped 6% to $10 million, or 43 cents a share. Revenue decreased 14% to $108 million. Its gross margin rose from 23% to 25%, and its operating margin climbed from 15% to 16%. A quick ratio of 0.3 demonstrates weak liquidity. A debt-to-equity ratio of 0.7 is below the industry average, indicating restrained leverage.
The stock: MGE has advanced 10% this year, less than the Dow Jones Industrial Average and S&P 500 Index. The stock trades at a price-to-earnings ratio of 15, a discount to the market and utility peers. The shares pay a 4.1% dividend yield.W.W. Grainger (GWW) sells a wide array of commercial equipment, including duct tape, office furniture and air compressors. The numbers: Third-quarter net income increased 3% to $145 million, or $1.88 a share. Revenue fell 14% to $1.6 billion. Its gross margin was unchanged at 42%, and its operating margin declined from 13% to 12%. The company has a strong financial position, with $672 million of cash and $535 million of debt. The stock: Grainger is up 21% this year, matching the S&P 500. The stock trades at a price-to-earnings ratio of 17, a discount to the market and distributor peers. The shares pay a 1.9% dividend yield.
Select the service that is right for you!COMPARE ALL SERVICES
Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV